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Cryptocurrency exchange FTX has announced that it has begun reviewing its global holdings and is preparing to sell or reorganize a number of subsidiaries.
FTX along with 101 of 130 affiliatestook legal action to allow the operation of the new global cash management system and payments to their critical suppliers. The exchange and its branches filed
US Delaware bankruptcy filing11th of November. The reason was one of the most high-profile defaults in the history of the crypto industry, due to which about 1 million investors faced losses of billions of dollars.
New FTX CEO John Ray III (J.Ray III) stated that the exchange will consider selling its divisions. Highlighting that some subsidiaries, such as the LedgerX cryptocurrency exchange, are free from debtor claims at the time of filing for bankruptcy:
“In the coming weeks, our priority will besales studies, recapitalizations and other strategically important transactions in relation to these and other subsidiaries, which we determine as our team continues to work.”
FTX asked the court for permission to pay $9.3 million to its key suppliers before the court decision and up to $17.5 million after the final decision comes into effect. The exchange warned that if it did not get a court order, it would result in "immediate and irreparable damage" to its business.
FTX debtors filed parallel petitions forprovisional measures in the Bankruptcy Court, a hearing scheduled for November 22. While no deadline has been set for the sale or restructuring, Ray asked all stakeholders to be patient.
Recently, the law firm Paul Weiss reported,that it is terminating legal support for former FTX CEO Sam Bankman-Fried, citing a conflict of interest.